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KAI RYSSDAL: The federal government has been throwing its weight around in K-12 education for years, more so since the Bush Administration launched No Child Left Behind. Now the Obama Administration is throwing some serious money around. The president announced a new program today called Race to the Top. More than $4 billion from the stimulus package will go to states that take specific steps to improve public education. Not a dime to states that don't.

Marketplace's Mitchell Hartman reports.

Mitchell Hartman: Using language that could have come out of a conservative think tank, President Obama today laid down a gauntlet to school officials across the country who want a shot at the money.

Barack Obama: And rather than divvying it up and handing it out, we are letting states and school districts compete for it. That's how we can incentivize excellence and spur reform.

And the president acknowledged that not everybody will make the cut.

Obama: States that outperform the rest will be rewarded with a grade. Not every state will win and not every school district will be happy with the results.

Many states will have to change laws and regulations to be eligible. That poses political challenges, especially with teacher unions that oppose things like paying teachers more based on student scores.

I reached Tennessee Education Commissioner Tim Webb in Washington after the president's speech. His state's already made many of the required changes.

Tim Webb: The issue of fairness here Mitchell in my opinion, is fairness to all children. And if a state is not willing to step up to the plate, they need to be pushed and need to be driven.

Russ Whitehurst of the Brookings Institution headed research at the Department of Education. He says there's a rush to adopt the "approved" systems.

Russ Whitehurts: I think lots of states have signed on, because they're afraid if they don't sign on, they'll be frozen out of the Race to the Top funds.

Analysts say there are still a lot of technical details to work out as states jump on board -- like how to compare student performance in 50 different states and how to link individual student achievement to what a specific teacher does in the classroom.